From eco-cars to gas guzzlers, Toyota adapts to the age of Trump - Nikkei Asian Revi
TOKYO/NAGOYA -- Toyota Motor and other Japanese carmakers are being forced to reconsider production plans in the U.S. as President Donald Trump pushes for major trade and environmental shifts in the American auto market.
Toyota quietly issued a press release this summer saying it will produce SUVs instead of the Corolla at a joint plant with Mazda Motor in Alabama, slated to open in 2021. Toyota also decided to produce mid-size pickups instead of Corollas at a Mexico plant coming online in the first half of next year.
The decision to switch production models is unusual for companies, since it typically takes years to line up suppliers for the roughly 30,000 parts that go into a vehicle. But Toyota is being forced to rethink its plans as the U.S. market leans toward larger vehicles and away from the eco-friendly cars that are the automaker's forte.
Trump has been pushing to ease fuel efficiency standards since taking office in January 2017. American companies like General Motors have responded by bolstering their lineup of larger vehicles, forcing Toyota to follow suit.
Parts suppliers face even greater uncertainty. "Maybe just paying the tariff is really the least burdensome option," pondered Katsuya Nishi, president of Japanese supplier Sanden Holdings at a summer meeting.
Management at the air-conditioning parts maker discussed whether it made more sense for it to continue to ship finished products from Mexico instead of trying to produce in the U.S. to avoid tariffs. But it co....